News

Consumer Action Law Centre has made a submission to the Senate Economics References Committee inquiry into the performance of the Australian Securities and Investments Commission (ASIC).

Briefly:

• we consider that an effective regulator is essential for a well functioning consumer protection system. However, a proper consideration of ASIC’s effectiveness as a regulator needs to not only consider the performance of ASIC  but also whether this broader system is working;
• we are generally very impressed with ASIC’s performance as a regulator of the areas of consumer law that we relevant to our work;
• however, we do have concerns with the time it can take for ASIC to respond to systemic issues we have raised with it;
• this submission suggests the committee consider whether:
  • ASIC has the necessary level of resources to do the enforcement work that is expected of them;
  • ASIC should be resourced more through a ‘user pays’ model rather than relying only on consolidated revenue;
  • ASIC should do more to inform complaints and the public about the conduct of its investigations;
  • shifting the focus of financial services regulation from disclosure to the substantive conduct of business could reduce the drain on ASIC’s enforcement resources;
  • enhancing ASIC’s powers could allow it to respond more quickly and effectively to market misconduct;
  • the introduction of a last chance compensation scheme would improve consumer protection and reduce demand on ASIC enforcement resources;
  • ASIC could do more to prioritise the needs of vulnerable and disadvantaged consumers; and
  • enhancing the responsibilities of the ASIC CAP to more closely resemble the Financial Services Consumer Panel (which is hosted by the UK’s Financial Conduct Authority) might improve ASIC’s consumer protection outcomes.

A full copy of our submission is available by clicking: The performance of the Australian Securities and Investments Commission.